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Xcel will issue consumer refunds, but another rate increase looms

Xcel Energy on Wednesday said it made too much money on Colorado consumers last year and was seeking regulator permission to give back $45.7 million.

In the same breath, the company said later this year, it probably will file for a rate increase of undetermined value and duration for 2015 and beyond.

The rare refund move, if approved by the Colorado Public Utilities Commission, would mean a 1.5 percent reduction in customer bills, the company said in a statement.

That translates to about $1.17 a month for the typical residential customer and $2.33 a month for the typical small-business customer, Xcel said.

The one-year refund, which would begin Aug. 1, must be approved by the PUC and other parties to a 2012 rate agreement that caused the overage.

The three-year agreement was negotiated between parties representing Colorado consumers and raised rates by $114 million. It was approved by the PUC in April 2012. It gave multiyear increases in base electric rates, the first time the company was allowed to offer that type of plan.

The plan was to raise consumer bills in three annual steps by a total of $3.70. It provided a sharing mechanism for any overages if certain financial targets were exceeded.

Typically, rate plans cover a certain period, often three or five years, and are for a fixed amount.

The company originally requested a $142 million increase before the agreement was negotiated with the PUC staff, the Colorado Office of Consumer Counsel, AARP and Xcel's two biggest industrial customers: CF&I Steel and Climax Molybdenum Co.

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"This credit to our Colorado electricity customers demonstrates the benefits of multiple-year rate plans by providing incentives for the company to manage its costs, and by establishing customer protections that allow them to share in our success when we exceed our financial targets," David Eves, president and CEO of Public Service Co. of Colorado, an Xcel Energy company, said in a statement.

Xcel said it plans to file for future rate increases this year, and, Eves said, "it is our hope that we will be able to continue with multiyear ratemaking in future years."

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